Demographic Dividend: A comparative analysis of India and Italy

Summary

This article explores the concept of demographic dividend. A comparative analysis between India and Italy is used to find various aspects of the changing demographic characteristics of nations.

India and Italy in the Last 200 Years

*It is an Interactive Image, click the play button. The size of the bubble represents the population of the country.

Source: Gapminder, Hans Rosling's 200 countries 200 years in 4 min, R Package: gapminder

Demographic dividend refers to economic growth due to changes in the age structure of the country's population. The reason for the change in the age structure is usually a decrease in birth rate and death rate. Demographic dividends are events in a country whose economic growth has accelerated due to a decrease in birth and death rates. A country with a low birth rate and low death rate receives an economic dividend or benefit from the increase in productivity of the working population. If fewer births are registered, the number of young dependents will decrease relative to the working-age population. If there are fewer people to support and more work, financial resources are freed up and invested in other areas to accelerate development.  To obtain a demographic dividend, a country must undergo a demographic transition. It moves from a largely rural economy with high birth and death rates to an urban, industrial economy characterized by low birth and death rates. In the initial phase of the transition, the birth rate falls, leading to a labor force that temporarily grows faster than the dependent population. All else being equal, per capita income will grow faster during this period. This economic benefit is the first dividend that a country with demographic changes will receive.

Demographic transition

Demographic change is a phenomenon and theory that refers to the historical transition from high birth rates and high death rates in societies with minimal technology, education (especially for women), and economic development towards low birth rates and low death rates in technologically advanced societies, education, and economic development and the stages between these two scenarios. In terms of economic growth, a demographic transition has swept the world over the last two centuries, and the unprecedented population growth of the post-Malthusian period has been reversed, significantly lowering birth rates and population growth in all regions of the world and making the transition possible. . of economies. more benefits of factor accumulation and technological progress on per capita income growth. Demographic changes strengthen the economic growth process through three changes: (i) depletion of capital and land resources, (ii) greater investment in human capital, and (iii) increase in the labor force relative to the total population and changing age of the population. Although this change has occurred in many industrialized countries, the theory and models are often inaccurate. 

Stages of demographic transition

Stage 1 - High birth and death rates cause slow population growth- Stage 1 shows a high birth rate and high death rate which causes a sluggish growth rate. The reasons for this can be poor medical facilities, low education levels, poor infrastructure, and inequality between men and women.

Stage 2 - Death rates decrease, but birth rates remain high, leading to faster population growth. In stage 2 there is a decrease in death rate but not in birth rate. The reason for this can be that there were improvements in medical facilities which led to a decline in the death rate but not in birth rates the mentality of people said more children leads to more labor and more wages.

Stage 3 - The birth rate begins to decline, so population growth begins to slow- In the third stage both birth rates and death rates start declining the reason for which can be improved medical facilities and a change in the mental statuses of people, but not as much and birth rates were still higher.

Stage 4 - Birth rate catches up with death rate, so population growth slows to zero- In stage 4 both birth rates and death rates started to decline. But because of good medical facilities death rates were very low as compared to birth rates.

 

Source: https://papp.iussp.org/sessions/papp101_s01/images/demographic_transition.png

India's demographic dividend

India is the world's most populous country, home to one-sixth of the world's population and population. India overtook China as the world's most populous country at the end of April 2023 with a population of 1,425,775,850, according to the United Nations. Between 1975 and 2010, the population doubled to 1.2 billion and reached the billion mark in 200. India. beat China to become the most populous country at the end of April 2023. According to UN data released in April 2023, India beat China to become the #039 most populous country in the world. According to the UN's World Population Panel and #039; India's population is now just over 1.428 billion, surpassing China's 1.425 billion, as reported by Bloomberg. Its population is expected to reach 1.7 billion by 2050. In 2017, its population growth was 0.98%, ranking 112th in the world. in contrast, between 1972 and 1983, the population of India and the number 039 grew by 2.3% per year. 4,444 4,444 In 2022, the average age of an Indian was 28.7 years, 38.4 in China and 48.6 in Japan; and until 2030; India's maintenance rate is just over 0.4. However, the number of children in India peaked more than a decade ago and is now declining. The number of children under the age of five peaked in 2007 and has been declining since then. The number of Indians under the age of 15 peaked a little later (in 2011) and is now also declining. India is home to more than two thousand ethnic groups, representing all major religions, as well as four major language families (Indo-European, Dravidian, Austro-Asiatic, and Sino-Tibetan) and two isolates: the NihalI language, which is spoken in parts. Maharashtra and Burushaski, speaking parts of Jammu and Kashmir. There are 1,000,000 Anglo-Indians in India and 700,000 American citizens in India. They constitute more than 0.1 percent of India's total population. In general, the linguistic, genetic, and cultural diversity of the people of India is surpassed only by the continent of Africa. The sex ratio was 944 women per 1000 male.

 

year	Population	Yearly %change	Yearly change
2024	1441719852	0.92%	13092189
2023	1428627663	0.81%	11454490
2022	1417173173	0.68%	9609331
2020	1396387127	0.96%	13275077
2015	1,322,866,505	1.29%	16450577
2010	1240613620	1.45%	17194981
2005	1154638713	1.62%	19001008
2000	1059633675	1.90%	19070909

 Source: https://www.worldometers.info/world-population/italy-population/

The data provides population data for different years, showing the population size, yearly percentage change, and yearly change. The population has been steadily increasing over the years, with a slight decrease in the yearly percentage change. The population has been steadily increasing over the years, with a growth rate ranging from 0.68% to 1.90%. The data provides a summary of population growth over the years, showing a consistent increase in population size with varying yearly percentage changes. The data indicates a steady rise in population numbers over time.

 There are several reasons for the high population in India:

 1.    High Birth Rate:    India has traditionally had high birth rates due to factors such as cultural norms, lack of awareness about contraception, and limited access to family planning services in certain regions.

 2.    Decline in Death Rate:    Over the past few decades, advancements in healthcare, sanitation, and nutrition have led to a significant decline in the death rate in India. This has resulted in a higher population growth rate.

 3.    Improvements in Healthcare:    Improved healthcare infrastructure, including better access to medical facilities and advances in medical technology, has contributed to increased life expectancy and reduced mortality rates.

 4.    Social and Cultural Factors:    Cultural and religious beliefs, such as the desire for large families and societal expectations, also influence population growth in India.

 5.    Poverty and Lack of Education:    Poverty and lack of education are significant factors contributing to high birth rates. Families with limited resources may not have access to or awareness of contraception methods, and there may be cultural barriers to family planning.

 6.    Gender Inequality:    Gender inequality, including limited access to education and employment opportunities for women, can contribute to higher fertility rates as women may have less control over reproductive decisions.

 7.    Urbanization:    While urbanization can lead to lower fertility rates over time, it initially contributes to population growth as people migrate from rural to urban areas in search of better economic opportunities.

Italy's demographic dividend

YEAR	POPULATION	YEARLY % CHANGE	YEARLY CHANGE
2024	5,86,97,744	-0.29%	-1,73,018
2023	5,88,70,762	-0.28%	-1,66,712
2022	5,90,37,474	-0.34%	-20,28,55
2020	5,95,00,579	-0.38%	-2,27,353
2015	6,02,32,906	0.14%	82,091
2010	5,98,22,450	0.55%	3,24,515
2005	5,81,99,876	0.43%	2,46,696
2000	5,69,66,397	0.03%	16,254

 Source: https://www.worldometers.info/world-population/italy-population/

It is evident from the data that Italy’s population is falling after 2015 and it was already as compared to others. It is almost 50 million as of 2024. The older population is more in Italy as compared to the younger population. The demographic dividend of Italy is not very good as dependent people are more which will be a curse to Italy’s government as they have to pay pensions and handle their expenses while no one is there to increase the productivity in Italy.  The reason for this can be that very few women are giving birth. This is because of Italy’s policy which says that if a woman gets pregnant she has to leave her job or she will get fired from her job. The woman doesn’t want to risk her job so they don’t conceive a baby and give birth.

The number of couples choosing to marry is increasing, but fewer and fewer are choosing to reproduce, a new ISTAT study has found. Between 2008 and 2016, there were 100,000 fewer births. A research firm used the latest data and said parents of Italian descent are still less likely to get pregnant than their predecessors.

 ISTAT suggested that two factors contributed to the decline in birth rates. There are now fewer women of childbearing age and more and more are choosing not to give birth. The biggest decrease is seen in couples where both partners are of Italian origin, but the decrease is also seen in Italy where the parents are of foreign origin. Based on the latest data, ISTAT said that 473,438 children were born in 2016, compared to 12,000 in the previous year, however, the number of marriages has continued to rise since 2015, with more than 200,000 marriages celebrated this year. According to the research firm, "On a generational basis, Italy's average number of children per woman continues to decline from 2.5 children per woman born in the early 1920s to 2 children per woman in the post-war generations ... to 1, 44 children per woman. woman in 1976." At the same time, the number of childless women has increased by 10 percent since 1950. The Italian government sought to reverse what Italian Health Minister Beatrice Lorenzini called an "apocalypse" in 2014. Italy has a "baby bonus" where families with newborns receive a grant of €80 per month to financially support them for the first three years after birth. There has been talk of doubling the bonus to encourage more couples, but that would increase public spending by around 2.2 billion euros over six years, at a time when Italy's economic growth has not picked up. The birth rate in Italy is one of the lowest in the European Union, it has been associated with economic pressure on the married couples of the country. According to a Business Insider report in September, only two days of fully paid paternity leave are offered beyond that. Other factors also contributed to the decline in the birth rate, such as high childcare costs.

 Reason for the declining population in Italy 

 Italy's population decline can be attributed to several interconnected factors:

 1.       Low fertility rates:   Italy has one of the lowest fertility rates in Europe. The total fertility rate, which represents the average number of children born to a woman during her lifetime, has been consistently below the replacement level of 2.1 children per woman. Low fertility rates mean that there are fewer births than deaths, contributing to population decline.

2.       Aging population:   Italy has an aging population, with a significant proportion of its population being elderly. As life expectancy increases and fertility rates decline, the proportion of elderly people in the population grows while the number of births decreases. This demographic shift places strains on healthcare and social welfare systems and can impact economic productivity.

3.       Emigration:   Italy has experienced significant emigration, particularly among young people seeking better economic opportunities elsewhere in Europe or overseas. Emigration reduces the population size and contributes to a decline in the country's workforce.

4.       Cultural and social changes:   Like many other developed countries, Italy has experienced cultural and social changes that have influenced family structures and attitudes towards marriage and child-rearing. Increasing urbanization, changes in gender roles, and evolving social norms contribute to delayed marriage and childbearing, which can impact fertility rates.

 Reason for low fertility rate in women in Italy

 1.       Changing societal norms and values:   Italy, like many other Western countries, has seen significant social changes over the past few decades. Attitudes towards marriage, family, and childbearing have evolved, with more emphasis on individual pursuits, careers, and lifestyle choices.

 2.       Delaying marriage and childbirth:   Italians, like many people in developed countries, are delaying marriage and childbirth. Many individuals are focusing on their education, careers, and personal development before starting families. This delay can contribute to lower fertility rates, as fertility tends to decline with age.

 3.       Gender roles and work-life balance:   Traditional gender roles and expectations around childcare and household responsibilities persist in Italy, making it challenging for women to balance work and family life. The lack of supportive policies such as affordable childcare and parental leave can further discourage couples from having children.

 4.       Housing and living conditions:   In urban areas, housing shortages and high living costs make it difficult for families to find suitable housing for raising children. Many young couples face challenges in finding affordable and spacious accommodation that can accommodate a growing family.

Conclusion

The decline in the birthrate can be attributed to a variety of factors, including a lack of stable jobs for young people and a lack of childcare support for those who do have them. Pregnant women are often forced to leave their jobs because they can't manage work and family, and then struggle to get back into the workforce. Some women even get fired when they become pregnant. One of the main reasons for the drop in the birthrate is the lack of women of childbearing age. While the economic situation and lack of social assistance can have an impact on the number of children, there is a longer-term trend toward fewer women having children. The model of parenting has also changed, as care standards have risen, leading to a greater emphasis on the cost of raising a child, as well as a fear of putting your child at risk. Successive governments over the past decade have offered various financial incentives to encourage people to start a family, the latest being a scheme launched by former prime minister Mario Draghi's government that offers families a monthly payment of €50 (£44). and €175 for each newborn up to the age of 21 years.

The demographic dividend refers to the economic growth that occurs as a result of changes in the age structure of a country's population, particularly a decrease in birth and death rates. This creates a larger percentage of the working-age population, leading to increased productivity and the potential for economic development. To achieve a demographic dividend, a country must undergo a demographic transition, moving from a rural economy with high birth and death rates to an urban, industrial economy with low birth and death rates. This transition is often accompanied by factors such as improved healthcare, education, and technological advancements.

India, currently the world's most populous country, is experiencing a demographic dividend due to its large working-age population and low birth and death rates. However, concerns have been raised about low fertility rates and an aging population. Italy, on the other hand, is facing a declining population due to low fertility rates, an aging population, emigration, and changes in societal values and norms. The low fertility rates in Italy can be attributed to factors such as delayed marriage and childbirth, changing gender roles, and lack of support for work-life balance and affordable housing.

 Overall, the demographic dividend can have significant implications for a country's economic growth and development, but it is important

 By 

Divneet Kaur Ahuja, M.A Economics (2022-2024), School of Behavioural and Social Science (SBSS), Manav Rachna International Institute of Research and Studies (MRIIRS), Faridabad, Haryana. divneetahuja01@gmail.com